One advantage to keeping a pile of old newspapers at the foot of my bed is that I can discover how firms and the media often get their analyses wrong. Here's an amusing example about projections vs realized market reactions to the Trump victory:
London Evening Standard, 04Nov16 by Jamie Nimmo
Trump victory prospects send shares tumbling
'The prospect of Trump in the White House caused panic in the City today...' Neil Wilson, market analyst, follows on: "With Donald Trump having closed the gap on Hilary Clinton, the election result is too close to call... [:)!] If Trump wins, there could be a sharper sell-off in risky assets such as stocks [;)!]. If Clinton wins, a rally is in the cards. [Right! :)]
[Now lets see what really happened since the Trump victory]:
1) The SPX rallied 200 points, from 2100 to 2300. It keeps pushing record highs. See the chart below.
2) And here's anecdotal evidence from one formerly skeptical firm:
London Evening Standard, 25Jan17, by Jamie Nimmo
Ashmore [emerging markets fund] goes soaring as it shrugs off the Trump effect
'Shares in Ashmore took a pounding when Donald Trump won the election...But UBS today called the rush for the exit an overreaction... In fact, they recon that Ashmore is raking it in, forecasting $200mil of inflows for this quarter, [Now get this] the first time they have been positive for three years.' [Did they make a genius turnaround or did Trump get them the green light?]
[We are amused.]
